Monday, November 30, 2009

A Narrow Market

News that the Dubai World debt exposure might only be $26 billion rather than the $60 billion originally reported helped to wake up the market this afternoon. We already have a propensity for strong finishes, so a little well-timed positive news didn't hurt. Financials were the primary beneficiary of the news, and that helped the tone as well.

Even with the positive action in the final hour of trading, it was still a pretty quiet and uneventful day. The best action, other than the late run in financials, was in small-cap China stocks and some lower-priced biotechs. Overall volume was light, but breadth did turn positive late in the day.

Technically we aren't bouncing back with much vigor, but the bears still can't manage to gain any traction. It is a narrower market, and market players seem to be a bit more cautious, but we aren't cracking, and there isn't any aggressive selling.

Tomorrow is Dec. 1, and so far this year, the first day or two of a new month have had a positive bias. However, that doesn't always work. Last year on Dec. 1, the DJIA lost 680 points. This market looks much healthier than it did last year, but it is not quite as energetic as it was this summer......